New Energy Finance Presentation - Ken Bruder

UK Trade & Investment US Network ConferenceImplications of the Financial Crisis on Clean Energy Deployment

Ken BruderGeneral Manager - Americas

Miami, 20th November 2008

© new energy finance, 2008 2

DISCLAIMER

THE INFORMATION IN THIS DOCUMENT IS DERIVED FROM PUBLIC SOURCES. INFORMATION USED IS BELIEVED TO BE RELIABLE BUT HAS NOT BEEN INDEPENDENTLY VERIFIED BY NEW ENERGY FINANCE. NEW ENERGY FINANCE MAKES NO GUARANTEE OF ITS ACCURACY AND COMPLETENESS AND IS NOT RESPONSIBLE FOR ERRORS OF TRANSMISSION OF FACTUAL OR ANALYTICAL DATA, NOR IS IT LIABLE FOR DAMAGES ARISING OUT OF ANY PERSON’S RELIANCE UPON THIS INFORMATION. ANY OPINIONS IN THIS DOCUMENT CONSTITUTE THE PRESENT JUDGEMENT OF NEW ENERGY FINANCE, WHICH IS SUBJECT TO CHANGE WITHOUT NOTICE. THIS DOCUMENT IS NEITHER AN OFFER TO SELL, PURCHASE OR SUBSCRIBE FOR ANY INVESTMENT NOR A SOLICITATION OF SUCH AN OFFER. THIS DOCUMENT IS NOT INTENDED FOR DISTRIBUTION.

© new energy finance, 2008 3Source: New Energy FinanceAdjusted for reinvestment. Geared re-investment assumes a 1 year lag between VC/PE/Public

Markets funds raised and re-investment in projects. Grossed up value based on disclosed deals.

Global New Investment in Clean Energy, 2004 – 2008

Accounts for 10% of global energy infrastructure spendHas remained fairly robust through credit crunch so far…

$148.4bn

$92.6bn

$58.7bn

$33.4bn

2004 2005 2006 2007

58% Growth

76% Growth

60% Growth

4% Decline

2008e

$142.0bn

Surged from low level by around 5x between 2004 and 2007

© new energy finance, 2008

Source: New Energy Finance, BloombergIndex Values as of 04 November 2008; AMEX Oil, NASDAQ and S&P 500 rebased to 100 on 30 Dec 2002

NEX vs. AMEX Oil & Market Indices, 2003 - 2008

Triple Whammy:• Early stage

• Capital hungry• Exposure to energy prices


Public market transactions by financing typeQ1 2004 – Q3 2008

Source: New Energy Finance

Q1'04

Q2'04

Q3'04

Q4'04

Q1'05

Q2'05

Q3'05

Q4'05

Q1'06

Q2'06

Q3'06

Q4'06

Q1'07

Q2'07

Q3'07

Q4'07

Q1'08

Q2'08

Q3'08

Convertible &Other

Secondary

IPO

$3.1bn

$5.3bn

$1.0bn

$12.9bn

$3.6bn

$5.2bn$5.3bn

$3.5bn

$1.5bn

$6.4bn

$1.7bn$2.0bn

$1.5bn$1.2bn

$0.9bn$0.4bn$0.1bn

$0.2bn

$0.1bn

Q1'04

Q2'04

Q3'04

Q4'04

Q1'05

Q2'05

Q3'05

Q4'05

Q1'06

Q2'06

Q3'06

Q4'06

Q1'07

Q2'07

Q3'07

Q4'07

Q1'08

Q2'08

Q3'08


Total asset financing by typeQ1 2004 – Q3 2008

Source: New Energy FinanceGrossed up values based on disclosed deals.

Q1'04

Q2'04

Q3'04

Q4'04

Q1'05

Q2'05

Q3'05

Q4'05

Q1'06

Q2'06

Q3'06

Q4'06

Q1'07

Q2'07

Q3'07

Q4'07

Q1'08

Q2'08

Q3'08

Acquisition

Refinancing

New build

$26.3bn

$28.7bn

$34.7bn$34.4bn

$29.5bn

$25.7bn

$18.8bn

$25.2bn

$14.3bn$15.4bn

$12.4bn

$14.0bn

$10.1bn$8.6bn

$7.5bn$6.0bn

$4.0bn$3.5bn

$4.7bn

Q1'04

Q2'04

Q3'04

Q4'04

Q1'05

Q2'05

Q3'05

Q4'05

Q1'06

Q2'06

Q3'06

Q4'06

Q1'07

Q2'07

Q3'07

Q4'07

Q1'08

Q2'08

Q3'08


Asset financing new build by regionQ1 2004 – Q3 2008


Q1'04

Q2'04

Q3'04

Q4'04

Q1'05

Q2'05

Q3'05

Q4'05

Q1'06

Q2'06

Q3'06

Q4'06

Q1'07

Q2'07

Q3'07

Q4'07

Q1'08

Q2'08

Q3'08

ASOC

EMEA

AMER

$19.3bn

$23.2bn

$23.9bn

$26.5bn

$23.5bn

$17.1bn$16.7bn

$17.8bn

$11.9bn$12.2bn

$8.3bn$8.4bn

$6.9bn$7.0bn

$5.7bn$4.8bn

$2.7bn$2.1bn

$3.6bn

Q1'04

Q2'04

Q3'04

Q4'04

Q1'05

Q2'05

Q3'05

Q4'05

Q1'06

Q2'06

Q3'06

Q4'06

Q1'07

Q2'07

Q3'07

Q4'07

Q1'08

Q2'08

Q3'08


Oil Price, 1990 to 2030 (IEA forecast)

Source: New Energy Finance; International Energy Agency

$0

$50

$100

$150

$200

1990 1995 2000 2005 2010 2015 2020 2025 2030Historic IEA WEO 2008 Forecast IEA WEO 2007 Forecast


Clean Energy & Climate Funds, October 2008


9

Region refers to the headquarters of the Fund Manager

Clean EnergyEnvironmental & Climate Change

$5,305m

$1,994m

$3,541m

$3,240m

$1,571m

$37,088m

$4,885m

$1,201m

$5,434m

$163m

$20m

$1,558m

VC / PE PublicEquity Project Equity

Project Debt

AMER

ASOC

EMEA

Total over

$65bn


President-elect Barack Obama’s position on clean energy

Supports 36bn gallon by 2022 Renewable Fuels Standard; would keep high tariff which prevents Brazilian ethanol import

Supports federal Renewable Portfolio Standard, has proposed 25% of power generation by 2025; voted in favour of extending Production Tax Credit/ Investment Tax Credit (now passed)

Supports national cap-and-trade system; proposed returning emissions to 1990 levels by 2020 via auction-based carbon system that would auction 100% of credits

Would invest $150bn over 10 years in clean energy, including electric vehicles, clean coal and renewable power

Has threatened to ban conventional coal plants; has not ruled out development of new nuclear plants

“Finding the new driver of our economy is going to be critical. There is no better potential driver that pervades all aspects of our economy than a new energy economy ... That's going to be my No. 1 priority when I get into office, assuming obviously that we have done enough to just stabilize the immediate economic situation.”


VCPE for companies by financing typeQ1 2004 – Q3 2008


$5.4bn

$6.1bn

$3.2bn$3.5bn

$3.0bn

$3.5bn$3.5bn

$1.8bn

$2.4bn

$3.5bn

$1.6bn

$2.2bn

$1.6bn$1.7bn

$0.9bn$0.6bn

$0.4bn

$1.3bn

$0.2bn

Q1'04

Q2'04

Q3'04

Q4'04

Q1'05

Q2'05

Q3'05

Q4'05

Q1'06

Q2'06

Q3'06

Q4'06

Q1'07

Q2'07

Q3'07

Q4'07

Q1'08

Q2'08

Q3'08

Q1'04

Q2'04

Q3'04

Q4'04

Q1'05

Q2'05

Q3'05

Q4'05

Q1'06

Q2'06

Q3'06

Q4'06

Q1'07

Q2'07

Q3'07

Q4'07

Q1'08

Q2'08

Q3'08

PIPE/ OTC

PE Buy-out

PE ExpansionCapital

VC Late Stage

VC Early Stage


VCPE new investment by sectorQ1 2004 – Q3 2008


Q1'04

Q2'04

Q3'04

Q4'04

Q1'05

Q2'05

Q3'05

Q4'05

Q1'06

Q2'06

Q3'06

Q4'06

Q1'07

Q2'07

Q3'07

Q4'07

Q1'08

Q2'08

Q3'08

Other Low CarbonTechnologies

Efficiency

Other Renewables

Biomass & Waste

Biofuels

Wind

Solar$0.2bn

$0.7bn

$0.4bn$0.4bn$0.5bn

$0.8bn$0.7bn

$1.1bn

$1.4bn

$2.4bn

$2.0bn$1.6bn

$2.5bn$2.2bn

$2.2bn

$3.0bn

$2.7bn

$4.3bn$4.2bn

Q1'04

Q2'04

Q3'04

Q4'04

Q1'05

Q2'05

Q3'05

Q4'05

Q1'06

Q2'06

Q3'06

Q4'06

Q1'07

Q2'07

Q3'07

Q4'07

Q1'08

Q2'08

Q3'08


Venture capital only by regionQ1 2004 – Q3 2008


Q1'04

Q2'04

Q3'04

Q4'04

Q1'05

Q2'05

Q3'05

Q4'05

Q1'06

Q2'06

Q3'06

Q4'06

Q1'07

Q2'07

Q3'07

Q4'07

Q1'08

Q2'08

Q3'08

ASOC

EMEA

AMER

$1,197m

$927m$896m

$1,051m

$1,040m

$815m

$688m

$543m$516m

$710m

$525m

$294m

$395m$451m

$255m$249m

$264m

$407m

$197m

Q1'04

Q2'04

Q3'04

Q4'04

Q1'05

Q2'05

Q3'05

Q4'05

Q1'06

Q2'06

Q3'06

Q4'06

Q1'07

Q2'07

Q3'07

Q4'07

Q1'08

Q2'08

Q3'08


The world is changing

From

Supply-chain constrained

Turbine shortage

Silicon shortage

Biofuels broken

Infinite availability of finance

Limited focus on quality

US largely disengaged

To

Finance constrained

Turbine surplus

Silicon surplus

New start for biofuels

Consolidation

Focus on good projects, technologies, teams

US engaged


Wind turbine supply lead times: months

Source: New Energy FinanceNotes: Trend line reflects 30point rolling average beginning in April 2001. Lead times are based on expected start of delivery, less date of contract signed.

April 2001-March 2008

© new energy finance, 2008 16

Offshore wind projects by location and status, YE 2007

Announced/plannedFinanced/under-construction

Commissioned

Source: New Energy Finance, Bloomberg


Estimated new solar silicon production, 2006-2011: tonnes

Source: New Energy FinanceNote: Assumptions and Tier assignment described in Appendix I: Supply methodology.

165,000

126,000

86,000

52,000

27,000 19,000

2006 2007 2008 2009 2010 2011

Tier 3

Tier 2

Tier 1


Median forward price of polysilicon for delivery 2008-20152007-2008 contracts, $/kg

Source: New Energy Finance Silicon Price Survey Note: Hyperpure and solar-grade silicon have been aggregated. Three separate contract duration has also been aggregated for non-Participant report. Approximately half of these contracts are inflation-adjusted, half fixed.

200

5860677382

93

115

2008 2009 2010 2011 2012 2013 2014 2015


2006 US biofuels bull run


$8.7bn

$13.1bn

$4.2bn

$1.0bn$1.0bn$0.7bn

$0.2bn

M&A/ MBO

Newinvestment

2001 2002 2003 2004 2005 2006 2007

VC/PE, Public Markets and Asset Finance only. Excludes re-investment adjustment. Grossed up value based on disclosed deals

$6.9bn

$4.0bn

$0.2bn$0.04bn

Thank you!

Ken BruderGeneral Manager - [email protected]+1 212 744 1988

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New Energy Finance Presentation - Ken Bruder

Economy & Finance